Car insurance rates are rising, but your driving record has nothing to do with it.
Why? It’s not you, it’s your car.
We all know that automakers have been collecting data from their vehicles for years. The original intent was to use the data to identify problems. For example, they might notice that a particular model was consistently having idling issues. Now the automaker can issue a technical service bulletin or recall to fix the issue.
Pretty harmless, right?
However, somewhere along the line, they realized they could profit from your data, and these days, money is tighter than ever as they’re losing money on every electric car they make.
This has been far more effective than other money-making tactics they’ve tried in the past, such as charging subscription fees for amenities like heated seats and navigation (which upset customers) or doing away with AM radio (it turns out drivers want it).
The best part is, your customers don’t need to know about it.
Who wants this data? The federal government, police, and especially insurance companies.
Here’s an example: You work in a high crime area, and the police see you there every day, Monday through Friday, 9-5, and they assume that your car is at high risk of being damaged or stolen.
Higher rates for you!
“But I park my car in the parking lot!”
They don’t know that, this is all being done by computers and AI.
The computer will make a decision based on your driving style – maybe there was a squirrel on the road or a pothole that you avoid every day – and therefore will make a defensive maneuver that is completely safe.
To a computer, you’re taking a selfie while eating pizza. All that matters is what you type. The computer records these sudden swerves without knowing why you did them. They add up, and eventually you’re not as safe a driver as you thought you were.
The computer knows how fast you’re driving, where you’re going, etc. That data is created by you, but it doesn’t belong to you. It belongs to the car company. I’ve actually asked car manufacturers, “What are you doing with that data?”
And they always say, “It’s safe. You’re not just going to post it somewhere.”
“No, but they’re selling them to make up for losses on EVs that no one wants!”
That’s the bad news. Here’s what you can do about it.
1. Compare insurance options every six months
Going out for a good time isn’t for everyone, but it can save you money. You can compare prices on sites like Get Jerry or progressive AutoQuote Explorer.
2. Consolidate your insurance
If you have renters insurance, homeowners insurance, or other vehicle insurance, consolidating it all with the same insurer can make a big difference.
3. Pay your premiums in advance
You can often save a few dollars by choosing to pay your premium in full up front, rather than splitting it into six monthly installments.
4. Increase your deductible
Your deductible is $500? We’ll raise it to $1,000.
Of course, there are downsides to this — if you get into an accident, your out-of-pocket costs will be $1,000 instead of $500 — but if you don’t mind taking the risk, this is a good way to save more money.
5. Go paperless
Many businesses can get a 5-10% discount when they switch from paper to electronic invoices.
6. Get good grades
Do you have a student driver on your policy? Some companies will give you a 10-25% discount if the student has a grade of B or above. Just mention it. It may be worth it to get a discount, especially if you have more than one child driving.
7. Take a safe driving course
It’s no secret that having a good driving record can keep your insurance premiums low, and you can also proactively improve your driving skills by taking driving safety courses.
AAA We offer one, National Safety Council and many private companies.
Usually it only takes a few hours and if it saves you money on your insurance it’s worth it.
8. Improve your credit score
The higher your credit rating, the lower your interest rate may be. Credit Karma and Nerd Wallet Any tips on how to do this?
9. Get telematics, or usage-based, insurance.
With telematics insurance, you pay insurance premiums based on the mileage you drive.
We don’t recommend this: While you might save money by driving less, other data will also be collected, which could increase your rates.
Or you could try what a friend of mine did: he drives his car down the street, parks it, then drives his wife’s car, so it looks like he’s barely driving at all. Would it have worked? I don’t know, but it seems like a lot of effort to game the system.
10. Talk to your elected officials
As I mentioned in my previous article, there is a movement to install AI cameras on the roads to issue tickets. Are you speeding? Are you wearing your seat belt? Are you holding your cell phone in your hand or on your lap? The computer, not the police officer, will make the decision, so there will be no opportunity for defense.
“This bill has already been passed as part of a $15.6 billion infrastructure bill, and the money will go to towns, counties and municipalities across the country. So now is the time to speak to your elected officials at the local level and say, ‘I don’t want this, and I don’t want to give up my privacy.’ The more people who speak out, the better off we’ll be.”
